Skip to main content

tv   Closing Bell  CNBC  October 10, 2013 3:00pm-4:01pm EDT

3:00 pm
the search is over. the chinese say the per if he can hangover cure is sprite. the chemicals in the soda speeds up the metabolism of alcohol. hallelujah. >> i thought they were going to say bloody mary. thanks for watching "street signs," everybody. >> "closing bell" is next. see you tomorrow. good afternoon. welcome to the "closing bell," everybody. we enter the final stretch. maria bartiromo at the new york stock exchange. in the midst of a big rally on wall street. 235 points on the upside on the dow. >> second best rally of the year only going back to january 2nd. the market's message seems to be, mr. president, take the deal. now, what deal is that? let's get right to our john harwood in washington as we get ready for a key meeting at the white house. john? >> no audio.
3:01 pm
we're going to get back to john in a moment. clearly we had an audio issue there. john reporting on this upcoming meeting on the heels of the discussion last night. which by all accounts seems to indicate or suggest that perhaps we could see the government open as early as next tuesday as the -- what i'm hearing. >> the offer from the house republicans is to -- to have a temporary debt ceiling extension of about six weeks. then they have to decide if they're going to open the government again at that time. john harwood, are you back with us now? >> i'm with you. can you hear me? >> yes. >> now we can hear you. have at it. >> bill, the deal on the table from republicans, it will be discussed at 4:30 when republicans meet with the president at the white house. is that they're willing to -- excuse me. to raise the debt limit for about six weeks. to mid-november. the president is going to ask --
3:02 pm
insist that they reopen the government as well. now, there's some interesting back and forth today. jay carney said the administration would sign a clean increase in the debt limit to mid-november, but wants and will not make concessions until republicans also reopen the government. so republicans are trying to maintain the distinction. they think they can keep some leverage around the closing of the government. but they're in the process of retreating from the position they've been taking. i would expect that they would continue to retreat and ultimately reopen the government and raise the debt limit. because the president says he's not going to engage in negotiations, substantive negotiations, which is what they want, until both of those things happen. that's the trdrama that's playi out. we heard from john boehner earlier today. we heard from jay carney at the white house briefing. we've had democrats meeting with the president and republicans are about to come. things are moving rather quickly. we don't have specific
3:03 pm
legislative proposals from the republicans. but all of the signs are that they are moving toward a deal with the president, which from their point of view will alleviate some of the pounding they've been taking from the public over this standoff. and from everybody's point of view, would obviate the threat to the economy as well as the effect on individuals from the government shutdown, guys. >> that little trust between these two sides, that the government has to be open in order to discuss the debt, i mean, if the republicans say, look, we are going to get this done, reopen the government by tuesday, knowing that we are talking about the debt limit, but the president says, no, no, no. i'm not even going to discuss it until i actually see the government reopen, is there that little trust that we can't just get on with things? move toward opening the government as well as having the conversation on debt? >> well, that's -- the president is saying, do both. then we will negotiate.
3:04 pm
i don't think trust is really the issue, maria. it's really more about the interests and the incentives for both sides. the president is not willing to negotiate at a time when the government's shut down. and the potential default on the treasury's obligations are hanging over the country. the republicans, and specifically a narrow slice of tea party republicans, believe that the prospect of bad things happening to the economy or as a result of the government shutdown give them leverage in the discussions over the long-term budget deal. that's a collision of interests that's not about trust. and what the president's trying to do is get the speaker, who wants to bring this to an end, to finally tell the tea party republicans, no. we're not waiting for the solution you want. we're not going to hold that leverage that you want. we're going to go ahead and make a deal and then we will have the budget negotiation if that, indeed, happens. >> all right.
3:05 pm
john, thanks so much. john harwood. >> at least they're talking. >> at least they're talking. >> better than yesterday. >> what if boehner emerges from the white house tonight and the deal goes sideways? will tomorrow's tape be a 200 point selloff on the heels of this 262 point rally? joining us on our closing bell exchange, heather hughes from american funds. mark lashimi. rick santelli. michael yushokami, you buy this? you want to believe a deal is at hand and buy here? >> absolutely. take advantage of the opportunity. they're going to ssessentially come off the cliff. this is crying wolf, really, maria, over and over and over and over again. we're going to do this six weeks from now. here's my recommendation five weeks from now. buy the dip. because we're going to have exactly the same situation that we have now. and i think that given the fact that yellen has been appointed, tapering looks like it's going to be off the table for at least a couple months given slowdown we'll probably see in the
3:06 pm
economy because of this ridiculousness, i think it is something you buy into, yes. >> heather, you'd been taking some money off the table leading up to this. were you buying into this? >> yes. michael, can you call me next time you know? i wish i had that heads up this morning. yeah, so the advisers have been raising cash on the sidelines. certainly clearly investors see missing this resolution rally as a greater threat than some sort of crisis pullback. whether you're for or against a temporary debt ceiling increase, clearly markets like it today. i like it. we'll take it. >> yeah. we'll take it. but what does that mean in terms of next steps? we had a real momentum market. some of those big high fliers, biotechs and tech really doing well. where do you want to allocate capital, mark lushini? >> maria, i think we stay with what it is we believed was going to work regardless of this impasse. we view it as something that is
3:07 pm
temporary. while it could put pressure on a near term basis on equity prices, over the horizon is better economic conditions not only domestically but globally on a synchronized basis. we like sectors like industrials and technology. financials and energies. those sectors that are geared towards improving the economic conditions. not just again in the u.s., but non-u.s. equity markets as well. >> i agree. >> pending a global growth story tend to do well and outperform. especially even a rising rate environment. you look ahead into next year, the technology sector is raising profits faster than the rest of the markets. they have a lot of cash sitting on the sidelines. again, in a rising rate environment look at industrials and technology sector for sure. >> rick santelli, certainly the equity market likes this. what about some of the markets you follow? is there a thaw on the short end of the yield curve today? dollar is up a little bit as well? >> you know, the dollar is up a little smidge. but that little smidge happens to have taken close to a
3:08 pm
two-week high with regard to a closing basis. yes, the 1-month bill is getting an awful lot of attention. i will continue to say putting a lot of anxiety in the fat tails that maybe demonstrated or shown by the behavior of the 1 month bill would be like everybody buying a ferrari every time they buy a lotto ticket. somebody's going to win. most likely it's not going to be you. i think the 3 month bill or 6 month bill has a lot more reality associated with it. in the stock market right now it's the fundamental for the treasury market. rates have moved up. we see a 3 week high yield on a 30 year. but i would question that when we're going through the malaise of the stocks, we notice that treasuries are in a tight range. i still think post-nontaper, that the treasury market still, an all issue is going to be more responsive to upsiding yield than downside. >> the white house endorsing the short term debt limit increase with no policy conditions attached, it signals potential
3:09 pm
support for the house republicans' plan for this month long reprieve from a default. at this point, it's a month long reprieve. we're going to be at this -- >> exactly. >> -- at this point again november 22nd. is this just short term trading? there's, again, no long term commitment? >> michael? >> yu know what it is, maria? you have to really decide what kind of investor you are. if you're a short term trader, it's anybody's guess. it's all driven by headlines. but if you're looking at long term fundamentals, you're looking at cheap money. you're looking at accelerating earnings growth. we'll see how the revenue looks. then what you do is you layer that in addition to short term entry and exit points. when you have this kind of craziness where they take us all the way up to tend. really, if you think about it, this has happened three or four times before. we go all the way up to the end. the market sells off. everybody's in a panic. everybody backs off their hard core positions. the market has a rally. that's not about trading.
3:10 pm
that's about entry point to get a good quality price on a long term position. >> when you think about it the last relief rally we had like this was on january 2nd after they'd resolved the fiscal cliff crisis we'd been wringing our hands about in december. >> exactly. >> very quickly, heather, we're up 281 points right now. is there going to be some point when you're going to want to take something off the table again? >> if you do believe that the u.s. is going to default on their treasuries, like michael was pointing out, if you're a long term investor, you would hope you could put some of that anxiety on the back burner for now. then you would want to load up on the staples of the apocaly e apocalypse. i guess you look at guns, fuel, or ramen noodles. but at some point in time, advisers have a lot of cash on the sidelines waiting to deploy that into these markets. looks like no tapering is in sight. with some sort of debt ceiling relief, markets will continue higher. hopefully on earnings.
3:11 pm
>> we'll see. >> we are moving. we've moved in the last five minutes. >> something is going on. this is a big move here. >> thanks, everybody. >> thanks, folks. we'll keep an eye on this. the biggest rally of the year, one day rally was in january when we did 2.53% gained on the down. we're up 1.9% right now. we've got a ways to go if we're going to catch that. still, a very impressive rally for this market today. >> investors making a bet that the meeting at the white house could yield at least a short term deal to take the debt ceiling deal off the table. are they getting ahead of themselves? we talk to lawmakers next on the odds of that deal materializing. >> there's one lawmaker in washington fed up with all this d.c. dysfunction. listen to this. >> ashamed. i'm embarrassed. all of us should be. >> so is senator john mccain hopeful this white house meeting will lead to a compromise? he will join us live later on the "closing bell." activist investor barry
3:12 pm
rosenstein taking a big stake in safeway and outer wall. find out his plans to turn around those companies. exclusive with him coming up from jana partners. also his reaction to the dysfunction in d.c. special exclusive interview coming up with the founder and head of jana partners on "closing bell." at a ford dealer with a little q and a for fiona. tell me fiona, who's having a big tire event? your ford dealer. who has 11 major brands to choose from? your ford dealer. who's offering a rebate? your ford dealer. who has the low price tire guarantee, affording peace of mind to anyone who might be in the market for a new set of tires? your ford dealer. i'm beginning to sense a pattern. get up to $140 in mail-in rebates when you buy four select tires with the ford service credit card. where'd you get that sweater vest? your ford dealer.
3:13 pm
3:14 pm
3:15 pm
welcome back. big rally under way. highs of the day. check it out. up 307 points on the dow jones industrial average. the market skyrocketing on hopes lawmakers may be nearing a deal. we're seeing this rally pick up in the last few minutes here. just 45 minutes before the close. what are you hearing? >> there's no headlines that are out there. the talk down here all day long is something positive will likely be announced at the white house meeting. that's where we're at right now. people keep asking me, aren't we getting ahead of ourselves? i'll tell you, not really. the important thing the traders down here, the critical issue is the debt limit. that's because that's where the -- the government shutdown is somewhat secondary. obviously important. that's why we're seeing the rally. meantime, if you look at everything here, it's a 2% day
3:16 pm
here. no matter where you go, we'll move to the upside. not just big cap. mid cap. small cap stocks. all of them are up 2%. if you take a look at the sectors, all the big cyclical sectors are up. roughly 2%. there you go. everything. throw a rock. hit something that's up 2%. finally just want to point out some of the other ones. the year's market leaders. biotech, high beta names we saw. health care. broker dealers and the airline stocks all rallying as well. just anticipation that something is going to be announced at that white house meeting. maria, back to you. >> bob, could it be something as simple as wall street saying to washington, this is what can happen when you guys start talking? >> yes. and, again, i want to point out that the debt ceiling is the most important thing. because that's where the default is. obviously it's important that the government stays shut down. people e-mail saying good evens, bob, there's not even a deal in the government getting back. why would the market rally? because the risk is in the default. that's what they're trying to address right now.
3:17 pm
>> thanks, bob. check back when you hear something else here. is the market betting correctly? that a short-term deal is likely to happen at this point. >> we want to ask two people who will be directly involved. representative brad sherman, democrat from california. scott garrett is a republican from new jersey. >> welcome back, everybody. >> good to see you, gentlemen. thanks very much. representative garrett, i want to ask you about some of the intricacies we talked about a moment ago with john harwood. that is if you're in a room with the president and the republicans and the president are meeting, and you come to a decision that, yes, we are going to open the government again. we're going to do everything we can to get the government reopened by tuesday. but in the meantime let's talk about the debt limit, let's talk about cutting spending, is that going to fly? >> so the operative word in all you described right there is the word "talk." right? unfortunately until this point, the president has said he will not engage in talk. he said that not only to republicans when he said i will
3:18 pm
not negotiate, i will not negotiate, he has said that apparently we learned in the last 24 hours even to members of his own party. i know you saw what happened when reid was confronted with a member of the -- democrat mayor of d.c. reid says don't screw this up by asking for us to open things up. the thing happened yesterday at the white house when democrat caucus members came to the white house and said wouldn't he begin to look at individual bills the republican house sent over there. the president basically said, no, he won't. >> let me get this straight. if the president says i am not discussing anything until i actually see the government reopened, then the house will not pass this? >> so that would be the president's position since day one. he said i will not negotiate unless i get what i want. that's not negotiations. every past cr, every past debt limit has always worked when the president has agreed to put things on the table and to talk and negotiate. till now the president has repeatedly said he will not.
3:19 pm
it's his way. he has slammed the door on any negotiations. he has not come out -- as of right now he has not come off that position of saying he is willing to negotiate. i certainly do hope he will. >> anything's possible in this meeting coming up in an hour and a half here. congressman sherman, i mean, are we going to make progress on this? can't we get some discussions going even if the government is not reopened for business in the next few days here? why can't we just have a conversation? >> the president's having that conversation at the white house. the president has made enormous concessions already. first, this cr that passed the senate and that the president wants to sign is a quarter trillion dollars less of spending than the president requested back in february. second, the president has restrained all of us on the democratic side. you know, this idea of shutting down the government unless the bill you want to pass passes could have been on both sides. we could have had a situation where democrats were going to shut down the government unless we got a pathway to citizenship
3:20 pm
and immigration reform. unless we got gun control. we have decided we'll keep the government open even if we otherwise can't pass and use it as a leverage point to pass things that are just as important to us as crippling obama care is to the other side. we're not taking hostages. taking hostages is not something that should be rewarded. >> all right. >> the cr should pass. and then, of course, the president will discuss things just as he's discussing things this afternoon. >> representative garrett, i mean, everybody agrees. we've got to get the spending under control. we've got to get the debt under control at this point. but is it -- here's the problem i think a lot of people have. and we see this on wall street. is it appropriate to use the debt ceiling and our obligations to pay our bills as a -- as an appropriate bit of leverage in these negotiations? i mean, when you risk the credit quality of the united states, which is something very precious to us here to keep our government going, is it
3:21 pm
appropriate to use that as leverage in negotiation? >> so all we have to do really to answer that question is to look at history. throughout history, including now, we want to make sure that we -- the u.s. does never, ever, ever default on its debt. that's is the initial statement here. that's where we all stand. and history also shows that numerous times, matter of fact, we've had 53 debt limit pressure points over the last several decades, in more than half of those cases you have had negotiations. more than half of the cases you've had so-called strings attached. you might ask, which party was pushing that in all those times? 60% of the time it was a democrat caucus pushing it. you might say who was in the white house? the majority of the time it was a democrat in the white house as well. the history is, yes, we have had negotiations in the past. you've added strings to debt limit increases. the difference this time, the only difference this time, is that you've had a white house who said, and i quote, i will
3:22 pm
not negotiate on the debt limit. that is different than clinton, reagan, carter, you name it. we need to get him past that point of no negotiation. listen to republicans. we're throwing out a whole new proposal on the table right now. if he will come to table -- >> do you guys think it's extraordinary that it's breaking news that the two sides talk? that's breaking news today? >> it should not be. >> we could be holding out and saying let's shut down the government and have a negotiation about immigration reform. let's keep every -- let's default on our debt until we get gun control. that's not the position we're taking. nowhere in my lifetime have we come -- had this bad an effect on the economy on a debt limit bill because one side is using it as a last minute pressure point. >> congressman sherman, let me just be clear about this. you're saying that you would have used them as leverage if
3:23 pm
the president did not stop you from doing that? is that what you're saying? >> no. i don't believe in doing that. i applaud the president for not doing it. if only the republicans weren't doing it as well, we wouldn't be here and your ratings would be lower. >> we're at the precipice. we're a few days away from the debt limit. the market is rallying on this belief you're going to get a deal done. don't you have to put a little trust out there? don't you have to put a little trust out there and say, okay, you're going to work over the weekend. you're going to do what you can to get this government reopened by tuesday. >> pretty please? >> in the meantime let's talk about the debt limit. this is not brain surgery. you're saying you won't even engage in that? you have to see this government reopened before you even have a conversation about the debt limit? that's what you're saying? >> no. we should be having conversations all the time. the president's having the conversation with republican leadership within hours. >> but you're not. >> go to the white house. the conversation is taking place here. it's just a little bit above my pay grade. >> but you're right. the president has not engaged in that up until the point that the republicans said, okay, we'll do
3:24 pm
a short term debt limit increase. finally that has -- go ahead. >> well, we are horribly over time. to be fair on both sides, the president has said he doesn't want to negotiate the debt ceiling in this particular case because he wants to break what he said was a fever that's gone on as you pointed out, this has gone on many times before in washington. and it's not an appropriate time -- leverage to use in negotiations when you're dealing with the full faith and credit of the united states government. >> but the history -- >> either side should take -- >> if i may, the history is, is that we always get to this point and both sides agree to associate. the difference this time is the president has agreed not to negotiate. >> we get to a month before this point. we get to weeks before this point. we don't hold the economy hostage. >> we're wishing you luck. gentlemen, thank you very much. 35 minutes before the closing bell sounds before the day. a market that is up 300 points on the dow jones industrial
3:25 pm
average. >> fingers crossed. hewlett-packard one of the few stocks down today after famed short seller explained why he's still betting against the company's turnaround. >> they're talking about lots of restructuring. margins improving. i'm hard pressed to see how margins are going to improve at any of their businesses given the secular head winds that are going on. >> when we come out we'll find out if he has it right or if hp's selloff is turning into a buying opportunity. >> if he's betting against hp, activist investor barry rosenstein is baiting on safeway and outer wall. the company that owns red box movie kiosks. how he's allocating capital. he's with me live today on "closing bell." it's as simple as this. at bny mellon, our business is investments.
3:26 pm
managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has. investment management combined with investment servicing. bringing the power of investments to people's lives. invested in the world. bny mellon.
3:27 pm
opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.
3:28 pm
the nasdaq is having its biggest point gain since january as are all the major averages. the nasdaq is especially strong today, seema mody. technology stocks are back. >> best intraday game for the nasdaq since january 2013 as you just pointed out, on hope of a deal coming to fruition in washington. in response risk averse sectors including momentum players we've been speaking about that were hit hard earlier this week are now staging a comeback.
3:29 pm
internet names like netflix, social media players, facebook and groupon, outperforming traders, pointing to sure covering on those names. then there's biotech. one of those high beta sectors that sold off earlier this week. now in comeback mode. citi says the selloff, what we saw -- the selloff we saw was inevitable as many of these names were trading in overbought territory. among the large caps, citi still favors gilead sciences and celgene. finally, blackberry saw an intraday pop on news that the co-founders have increased their stake to 8% in blackberry. the sec filing also indicates the two former executives are eyeing a potential takeover bid. the blackberry story is still in focus, maria. >> stick around. want to get more on this big rally today. joined by nick rash from the earnings scout. good to see you. tell me about your thoughts on this rally. 300 points higher on the dow. you just saw seema showing the
3:30 pm
nasdaq up 85 points. would you put money to work here knowing what you know and expect on the third quarter earnings season? >> wryeah. once we get past the debt ceiling issue which we think we will, we look at credit markets there, not the short end of the credit but the long end, it just doesn't believe there's not going to be some sort of compromise. when we get to actual earnings, we think more of the same in the third quarter. majority are going to cut estimates for the fourth quarter. they're too high. that doesn't necessarily mean stocks can't go higher. if they don't come down nearly as bad as feared, which were projected, we thinks stocks can rally through year end. >> clearly a relief rally here, nick, as they at least are talking in washington now. how much of this rally can you attribute to earnings. how much is it the fact you're going to see no tapering from the fed for the foreseeable future? we're still on the morphine drip from the fed at this point. >> right. i don't know today's rally is anything but a relief from the
3:31 pm
potential for a compromise. the near term here, it's all about what's going on in washington. once we get past that point, the big heger issue is ultimately gg to drive stock prices for future earnings. they're looking pretty good enough here. the thing we're watching the closest right now, very few people are talking about, we think is more critical for 2014 earnings and how you set asset allocation. what's going on in china in the emerging markets. >> yeah. >> a lot of the data coming out of china has been suggesting that their economy is improving in june, july and august. but the companies, u.s.-based companies and european based companies are saying something completely different about the earnings trends there. that's what we're looking at the hardest right now. >> interesting. seema, do you have any indications that, in fact, the momentum players, those techs, those biotechs that took a beating last couple of days but are back on fire today, that this is sustainable? >> i think that's the big question, maria. i have some traders who are telling me that technically
3:32 pm
speaking these stocks don't look that strong. perhaps the rally we're seeing in some of these momentum players are short lived. many of these players, of course, will continue to move based on the dysfunction that we see in washington. and if that continues to persist. >> all right. gang, thank you very much. nick, thanks for joining us. see seema, see you later. on we go. instead of a buttoned up deal, it seems we have hostility between two major sellers of men's suits. courtney reagan with the latest on that joseph a. bank proposal to acquire men's warehouse. courtney, it's ugly. >> joseph a. bank offering a 42% premium to acquire rival men's warehouse in an all cash deal. men's warehouse isn't interested. the company publicly responding saying no thanks. $48 per share undervalues the company. our planned strategy is better for our shareholders. but then shares spiked to $45 on the news of the deal proposal wednesday. the investment banks working on the deal say the response from men's wearhouse is where are
3:33 pm
disappointing and shareholders want the deal to happen. >> we've gotten overwhelming calls from shareholders of both companies totally supportive of this transaction. i mean, take a look at -- it's a win/win. i think over 40% of the shareholders of both companies overlap. we have not talked to george zimer. we don't know george zimmer. >> speaking of shareholders, zimmer is, of course, the recently ousted founder of men's wearhouse and currently the largest individual shareholder with a 3.7% stake. men's wearhouse ceo told me last month he hasn't spoken with zimmer either since he was terminated from his position as executive chairman over the summer. now, harrison of finango said it made a good offer. it's not going to negotiate against itself with a new offer. they hope shareholders will encourage men's wearhouse to sit down and have a conversation to discuss the offer further. maria? >> they won't do it until the government reopens.
3:34 pm
>> there's that, too. >> unbelievable. 30 minutes before the closing bell sounds for the day. we are rocking and rolling heading into the close. up 290 points on the dow jones industrial average. >> this huge rally taking a lot of investors by surprise. reaction from private equity giant jay jordan coming up next. also ahead, much more on the stunning rally. we'll also talk to the head of jana partners coming up next hour. back in a moment. the american dream is of a better future,
3:35 pm
a confident retirement. those dreams, there's just no way we're going to let them die. ♪ like they helped millions of others. by listening. planning. working one on one. that's what ameriprise financial does. that's what they can do with you. that's how ameriprise puts more within reach. ♪
3:36 pm
3:37 pm
welcome back. a sea of green on wall street today. all but one dow component in positive territory. chevron the only one slumping a bit. investors making a bullish bet lawmakers in washington may be close to a deal un the government shutdown and the debt ceiling. >> republicans will be at the white house in an hour. we begin that conversation. more reaction right now on the massive rally today. we have with us yay jordan, chairman of the private equity firm the jordan company. you used the word during the commercial break to describe this rally. "unbelievable." >> it's unbelievable. i'm really shocked given the state of play around the world. of course, this whole what the fed's doing, all the feds are doing.
3:38 pm
creating so much liquidity, global liquidity. i see in our business that we operate in the private sector. we aren't as affected by the public markets. however, we do look at the public markets to seek liquidity and to ultimately -- >> to turn in value, right? >> exactly. it affects everybody. i'm afraid it's not going to last. i'm very cautious. >> you think this market turns around, we could have the same kind of movement on the downside tomorrow or near term? >> my view, you know, we try to look out a year or so. our view is, is that we're building another bubble in our business. the banks are doing things that they shouldn't be doing. which is these overleveraging companies. toggle loans. covenant light loans. these are the kinds of loans that got everybody in trouble back in '08 and '09. we're starting to see that emerge. we happen to be very, very conservative and very cautious. i also think it's -- now, while u applaud the appointment of janetyellen, i think she's very highly qualified, but she is
3:39 pm
obviously a big fan of qe-3. as a keynesian and government intervention into the markets, it's somewhat dangerous in my view when you have -- we've been entering and living in a period of financial repression. when a sovereign interferes in a market activity in setting price of money or currencies, you end up having a misallocation of capital. and you end up having asset prices that are misvalued. >> we have talked a lot on this program about how equities become the only game in town. that's, i guess, precisely what the fed wants to happen. to go on the risk assets at this point as they lower interest rates to try and prop up the economy. your fear seems to be that when they start to remove some of that liquidity, the tapering begins, that's when equities go lower. is that your fear? >> i think all asset prices, real and financial, are going to go substantially lower. i think the emerging markets are
3:40 pm
going to be very much affected. capital will flow out of emerging markets. their currencies will -- >> which we've seen already. >> -- depreciate. and it's going to be some global chaos, i believe. >> so you'd sell these rallies if you were in the public market? >> well, don't ask me. >> let me ask you this. you're operating in the private space. i just got from the mario draghi lunch at the economic lunch. he made it clear. rates are going to stay at present or much lower lechls for an extended period of time. stimulus isn't going anywhere in europe. if you had to compare, this is buying private companies in the u.s. versus in europe, where are the valuations better? >> well, i think both places the value yauations are great. it's very dangerous to sustain a long period of low interest rates. it breeds speculation. it breeds overleverage. that's what happens. when the nut cracks and rates start to go up, the bond market gets hit pretty hard. when you're going to see it.
3:41 pm
i'm not an expert in this. >> but you are finding opportunities. >> yes. absolutely. >> you're buying companies in the energy space. education. water. food. tell us where the opportunity in the world today is. >> we study what global opportunities, we look out five to ten years. and the imf and the world bank come wup with a lot of great studies which we actually research. five common themes really are energy, education, food, ag, water, health care and water. those are things that we'd love to participate in more. that doesn't mean we don't do other things. but we think long term it's going to serve us very, very well. but i am very afraid of what all the central banks are doing. they're printing money. we're going to hit a period where that's going to stop. >> you know the bulls say when they do start to taper back, that will be the time when the economies are able to have sustainable growth. they'll be okay. >> that's a reasonable point. but my fear is, take the fed. we have, what, a balance sheet
3:42 pm
about $3 trillion now. nobody has any experience of rebalancing that kind of amount. >> exactly. >> as far as your money, putting your money to work, have prices gotten away from you at this point? with the market where it is, in the private sector, are things getting expensive? >> yes. and no. >> what does that mean? >> from the no side, we're able to pick some spots where we think we can reasonably compete. but, yes, overall prices -- money is so cheap. the same thing's happening. our activity is very, very robust, by the way. we're as active as we've ever been. we're excited about it. but we're very, very cautious folks. >> looking over your shoulder at all times. >> jay, good to have you on the program. >> thank you very much. >> jay jordan. >> stay right there. >> 20 minutes before the closing bell sounds on wall street. dow jones industrial average up 293 points. nasdaq on fire. markets responding well to the speculation the debt ceiling
3:43 pm
deal is on offer. vo: two years of grad school.
3:44 pm
20 years with the company. thousands of presentations. and one hard earned partnership. it took a lot of work to get this far. so now i'm supposed to take a back seat when it comes to my investments? there's zero chance of that happening. avo: when you work with a schwab financial consultant, you'll get the guidance you need with the control you want. talk to us today.
3:45 pm
bny mellon combines investment management & investment giving us unique insights which help us attract the industry's brightest minds who create powerful strategies for a country's investments which are used to build new schools to build more bright minds. invested in the world. bny mellon. democratic leaders just leaving the white house. democratic leaders of the senate
3:46 pm
just leaving the white house after meeting with the president. harry reid was just talking to reporters just a second ago. saying that they are going to take a wait and see attitude on further legislation until after the republican house leaders have met with the president. that meeting is scheduled 45 minutes from now. the key meeting that will take place in the white house will be between the president and john boehner and company when they get to the white house at 4:30 eastern time. we'll wait and see what happens there. that's exactly what harry reid and company are doing. they're going to take a wait and see attitude. >> of course, yesterday's meeting on the debt deal on the table spurred the markets into action today. a 300 point rally in the dow jones industrial average. dominic chu tracking it. >> let's start it off with share of smartphone maker blackberry getting a pop. moving to session highs after the company's co-founder and affiliates disclosed in a filing they really own 8% of all outstanding stock. that filing also said the group
3:47 pm
is considering all options available including a possible acquisitions of all shares they don't already own. then there's online movie streaming service netflix. we've been talking about it all day. coverage of the stock initiated by needham with a buy rating and $425 price target. analysts believe netflix could be a big beneficiary of not just u.s. but international demand for broadband video in the coming years. also gilead science is getting a huge pop today. the world's biggest biotech company by market value. halted trials of the cancer drug. for good reasons. gilead said patients taking one of its leukemia drugs in concert with other medications showed longer life expect tansies. we'll cap it with quest diagnostics. third quarter earnings and sales fell short of analyst estimates at fewer customers ordered testing amid stricter insurance company rules for cost reimbursements, maria. over to you. >> thank you so much. final ten minutes of trading. 291 points higher on the dow jones industrial. we did just hear there's a tinge to the sell side.
3:48 pm
very small shares sell. perhaps we come off of the highs here going into the close. nonetheless, stunning rally across the board. >> from yesterday's low, the dow is up 2.6%. that's big. >> tweet sfwlnchts coming up, two of our market pros react to the news from capitol hill and its impact on wall street. is the rally justified. we'll talk about it when we come back. ♪
3:49 pm
[ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪
3:50 pm
3:51 pm
welcome back. we're just in the ten minutes away to the closing bell. markets have soared today on bets that lawmakers are close to making a deal. we got commentary right now from harry reid. listen to this. >> what we missed him saying, majority leader reid in the senate says they will not negotiate on a budget issue with republicans unless the government is reopen. we're back to that give and take at this point. >> and that's can get a directi where things are going to go, markets could really react nicely this fall. >> we got a nice reaction right now, ann. would you buy it here? >> i think we have to be a
3:52 pm
little bit cautious. i think there's a real risk that the impact on the real economy starts to have a serious impact. it might be a short-term rally. we could see a little bit more pain down the line if this doesn't actually get stopped in time for the real economy. we're snatching defeat from the jaws of victory. >> i hear both of you saying fundamentals don't support a strong economy right now. ha about the federal reserve? we still have the scant at a time -- quantitative easing in place. with janet yellen coming in there's no sign it's going to end soon. >> i think yellen being appointed would be a real positive sign for the market. that's absolutely right. then we would have some degree of continuity and some confidence that having spent so much time with bernanke, the politics aren't going to deflect the reality there. i think that is a positive. >> let's talk about actually putting money to work. in terms of actual areas, sectors, specific names, the momentum plays have been hot all year. you want to be in those.
3:53 pm
do you want to sidestep because of the beating they've taken in the last two days? what's the story. >> we look for undervalued stocks that pay a dividend right now. >> where is that? >> stocks have had a nice runup. apple is a nice name right thousand. been beaten down just because the wizard of oz left the building. they've got color in time for christmas. iphone selling hot. 25 new countries where they're going to be available on october 25th. a big deal in china. we think that's a good name. >> special situations. what about you, anne? >> i think there's still a lot of value to be had in some of the stocks with more international exposure. because i think we've seen a real pullback in some of the sentiment around the emerging market world. stocks that have got good consumer exposure in those parts of the world, they'll see growth coming through even if we see domestic slowdown. >> europe or emerging markets? >> more emerging markets. there's really good companies in the states which have got fantastic exposure to those parts of the world. some of those have taken a little bit of a beating. >> thank you so much. appreciate that.
3:54 pm
appreciate you both. >> 2% gain. coming back with a closing countdown. see if we're up or down at this point. >> after the bell, hitting pause on red box. an investor says it may be time for the company to rewind. we'll talk exclusively to the head of jana, barry rosenstein. "closing bell" on cnbc, first in business worldwide. ♪
3:55 pm
wow...look at you. i've always tried to give it my best shot. these days i'm living with a higher risk of stroke due to afib, a type of irregular heartbeat, not caused by a heart valve problem. at first, i took warfarin, but i wondered, "could i up my game?" my doctor told me about eliquis. and three important reasons to take eliquis instead. one, in a clinical trial, eliquis was proven to reduce the risk of stroke better than warfarin. two, eliquis had less major bleeding than warfarin. and three... unlike warfarin, there's no routine blood testing. [ male announcer ] don't stop taking eliquis unless your doctor tells you to, as stopping increases your risk of having a stroke. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. while taking eliquis, you may bruise more easily and it may take longer than usual for any bleeding to stop. seek immediate medical care for sudden signs of bleeding, like unusual bruising.
3:56 pm
eliquis may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or dental procedures. i've got three important reasons to up my game with eliquis. [ male announcer ] ask your doctor today if eliquis is right for you. and his new boss told him two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade.
3:57 pm
both sides are digging in still. >> still. even at this point as republican leaders head to the white house. let's show you what has happened the last couple days. we pointed out over the last two days from the lows yesterday, the dow has risen about 2.6%. that's the best gain of the year. when you consider january 2nd the dow was up 2.35% just that one day. 2.6% gain there. the fear indicator we've been watching this week is the 1 month t-bill. that's what has done this week. this was the skyrocketing when it looked like we might have default in the whole thing. it goes sideways from there. keith bliss, you buying -- would you be part of this rally here as this rally continues? we're up 300 points fwagain.
3:58 pm
>> it's hard not to be. i would be selectively. i would keep some powder dry. we've seen this story out of washington before. the two groups seem to kiss and makeup. they go behind closed doors, come out in front of the cameras swinging their fists again. i wouldn't be too sure this is the ultimate end all, be all for some sort of deal we see out of these people. >> we'll talk to big activist invest tors in the next hour. investors go both sides on this. because of this inability to negotiate. i'll see you tomorrow, bill. see you next hour. thank you so much. >> what are you skeptical about? you know, the feeling i had from other traders this week was this selloff was a gift because they will come to a deal and then it's off to the races. that seems to be what's happening today. >> we always thought that. they would come to some sort of deal. i'm a little surprised at the magnitude of the move we got today just based upon some nice comments out of the republican conference. >> going out on the high of the
3:59 pm
session right now. is this the market showing hope for that meeting coming up in 30 minutes? >> certainly showing hope. we're not going to know the outcome until about 5:30. that's why i'm keeping some powder dry. i want to have some protection on any kind of move that moves to the contrary of what we're seeing here today. >> keith, thanks very much. always appreciate your comments here. we are going out with a 320 point gain. one of the strongest days. this is the second best day of the year for the stock market in 2013. much more to come, including that key meeting at the white house, coming up in the second hour of the "closing bell." i'll see you tomorrow. rock 'n' roll on wall street. hi, everybody. 4:00 on wall street. do you know where your money is? welcome back to the "closing bell." i'm maria bartiromo on the floor of the new york stock x change. big rally on the street today. investors turning optimistic washington may be nearing a deal on the debt ceiling. take a look at how we're finishing the day on the street. at the highs. dow jones industrial picking up volume as we approach the close.
4:00 pm
up 322 points. better than 2% on the dow. finishing 15,124. nasdaq up 83 points. check out the nasdaq. technology on fire today. bi


info Stream Only

Uploaded by TV Archive on